Accountant totally messed up my tax return - should I pay them?

spib

Hi,

I have an accountant who prepares my tax return once a year but this year they have totally messed it up (they calculated that I owe the IR £7,500 when in fact I've calculated that the IR owe me £2,500). They have been a nightmare to get hold of and when I did get hold of them they maintained that the return was correct and that they would send me a breakdown of figures to support this, I never received these figures.

They have billed me £80 + Vat for this service but given that the return they prepared was totally incorrect and I have had to figure out for myself that their calculations are incorrect I don't believe I should pay.

Have I got a case for refusing to pay for these services?

Thanks

James

Cook_County

1. What does the engagement letter say?
and

2. Which professional bodies is your accountant a member of?

Elaine_Wilson

I assume you have not signed the return yet.

My first thoughts are that a return has been prepared so they should be paid for this work. But only when you are satisfied that the work has been carried out correctly.

I would write and acknowledge receipt of the fee but note that your concerns regarding the accuracy of the return have not been satisfactorily addressed. Ask them again for the schedules showing how the return was prepared so you can compare the result with the information you provided.

Assuming they are wrong but correct the return at their own expense then I see no reason why they should not be paid. They may wish to reduce the charge as a gesture if you emphasise the time you have spent in sorting it out. But you would have been expected to check the return anyway so it probably boils down to the difficulty you have had in contacting them.

A difference in the calculation of £10,000 is rather significant, though. You need to ascertain how this came about if you are to have any confidence in their services in the future.

spib

Cook_County wrote: »

1. What does the engagement letter say?
and

2. Which professional bodies is your accountant a member of?

1. There's nothing specific in there about what happens if they are negligent in their services, just various bits about what would happen if I were negligent

2. ICPA

spib

Elaine_Wilson wrote: »

I assume you have not signed the return yet.

My first thoughts are that a return has been prepared so they should be paid for this work. But only when you are satisfied that the work has been carried out correctly.

I would write and acknowledge receipt of the fee but note that your concerns regarding the accuracy of the return have not been satisfactorily addressed. Ask them again for the schedules showing how the return was prepared so you can compare the result with the information you provided.

Assuming they are wrong but correct the return at their own expense then I see no reason why they should not be paid. They may wish to reduce the charge as a gesture if you emphasise the time you have spent in sorting it out. But you would have been expected to check the return anyway so it probably boils down to the difficulty you have had in contacting them.

A difference in the calculation of £10,000 is rather significant, though. You need to ascertain how this came about if you are to have any confidence in their services in the future.

Thanks for your advice. It sounds like it isn't worth pursuing this time around if they do finally complete it correctly. However, I won't be using their services again since they've caused me some significant anxiety in respect of the amount of money I thought I needed to find.

(The rather large difference in the amount of tax due is because my accountant put the figure which I been taxed at source in the field reserved for student loan payments. Consequently the amount of tax they calculated didn't take into account the amount of Tax I had already paid.)

fengirl_2

£80 to do a tax return is not a lot - I think you got what you paid for.

spib

fengirl wrote: »

£80 to do a tax return is not a lot - I think you got what you paid for.

So because it was cheap (in your opinion) I shouldn't be suprised when they don't provide the service which I asked for? That's totally irrelevant as far as I'm concerned. They have prepared 4 returns for me in the past with no issues, but their customer service and performance this year have been enough to encourage me not to use them again.

silvercar

fengirl wrote: »

£80 to do a tax return is not a lot - I think you got what you paid for.

:rotfl: Is £80 the price of an incorrect tax bill?

Your paying an expert to do a job. OK you may have a glance over it but you are paying for professional know-how. If they can't do it right they shouldn't be charging.

lincsdan86

As an accountant myself, why are you bothering paying someone to do this job if you are just going to calculate it yourself?? I think you should wait for the back up information in their tax computations before you start saying their figures are wrong. Accountants only use the figures that the clients provide.

If you dont think the return is correct maybe you should have a meeting with your accountant and see why there is such a difference.

Cook_County

I understand why it was only £80, because the ICPA is a membership association but one which is not a CCAB affiliated organisation so it has no exams required to join & does not appear to have a disciplinary scheme.

It is used mainly by unqualified advisers/salespeople. You have learned to choose a qualified accountant or tax adviser in the future, but the lesson has only cost you £80!

spib

lincsdan86 wrote: »

As an accountant myself, why are you bothering paying someone to do this job if you are just going to calculate it yourself?? I think you should wait for the back up information in their tax computations before you start saying their figures are wrong. Accountants only use the figures that the clients provide.

If you dont think the return is correct maybe you should have a meeting with your accountant and see why there is such a difference.

I've never calculated this myself before because I don't usually have time, but since there was such a large amount of tax requested and because my accountant weren't returning my calls or emails I decided to calculate it myself. The reason for the discrepency is because I have a full-time job and also freelance. When the accountant has filled out the tax return, they have missed the amount of tax I have already paid (at source from my P60) and instead put it into the Student Loans field on the return (I don't even have a Student Loan). The amount of money I paid last year as payment on account is more than double what I owe this year which is why I am due some tax rebate. I would happily have discussed this with my accountant if I could get hold of them

Anyway, thanks to everyone for their comments and advice. Now that I know how to calculate the return I will file it online myself next year.